By Denis Dumo

JUBA, July 23 (Reuters) - South Sudan Vice President Riek Machar has fired a minister who he said had defected to his long-time rival President Salva Kiir's party.

The rift between Machar and Taban Deng Gai has raised the prospect of further turmoil after months of fighting, as members of a faction led by Gai threatened to replace their leader.

Two years of civil war that erupted after Kiir sacked Machar as Vice President in 2013 has killed more than 10,000 people and displaced over 2 million, many of whom fled to neighbouring countries.

In a letter to party members and his military commanders late on Friday, Machar said Gai will be relieved of his position as mining minister, and had been expelled from the party.

Machar left the capital last week after a new outbreak of clashes, saying he would only return when an international body set up a buffer force to separate his forces from Kiir's.

Gai was part of a group inside the SPLM-IO party that issued a statement on Friday saying Machar should return to the capital Juba and carry on his work in the government, or be removed from office.

"By his action of defection, I have therefore relieved him from his positions as member of the SPLM/SPLA-IO Political Bureau and as chairman of the National Committee for Reconciliation and Healing," Machar said in the letter.

Gai was not immediately reachable for comment, nor was Kiir's spokesman. (Writing by George Obulutsa; editing by Susan Thomas)